The difference between a $5,000 and a $15,000 tax bill often comes down to knowing which deductions to claim. Most LLC owners take the obvious ones — software, office supplies — but miss deductions that could save them thousands. Here are 15 commonly overlooked write-offs.
15 Deductions You Should Be Claiming
1. Self-Employment Tax Deduction
You can deduct half of your self-employment tax from your taxable income. This happens on your 1040, not Schedule C. If you pay $12,000 in SE tax, you get a $6,000 deduction. Many new LLC owners miss this because it is not an "expense" — it is an adjustment to income.
2. Health Insurance Premiums
If you are self-employed and not eligible for employer-sponsored insurance, you can deduct 100% of health insurance premiums for yourself, your spouse, and your dependents. This includes dental and long-term care insurance.
3. Retirement Contributions (SEP IRA)
A SEP IRA allows you to contribute up to 25% of your net self-employment income, up to $69,000 in 2026. That is potentially tens of thousands of dollars in tax deductions while building your retirement.
4. Home Office Deduction
As covered in our home office guide, this can save $1,500 (simplified method) or significantly more (regular method).
5. Vehicle Expenses
Business miles driven at $0.70/mile (2026 rate). If you drive 10,000 business miles per year, that is a $7,000 deduction. Keep a mileage log — apps like MileIQ make this easy.
6. Business Meals
Meals with clients, prospects, or business associates are 50% deductible. The meal must have a clear business purpose, and you should note who you dined with and what was discussed.
7. Education and Training
Courses, workshops, books, and conferences related to your business are deductible. This includes online courses, industry certifications, and business coaching.
8. Professional Services
Accounting, legal, bookkeeping, and consulting fees. If you pay a CPA $1,500 to prepare your return, that is deductible.
9. Software and Subscriptions
Every business tool you pay for: accounting software, project management, design tools, CRM, email marketing — all deductible.
10. Phone and Internet
The business-use percentage of your phone and internet bills. If you use your phone 60% for business, 60% of the bill is deductible.
11. Bank Fees and Interest
Business bank account fees, credit card processing fees, and interest on business loans or credit cards used for business purposes.
12. Marketing and Advertising
Website hosting, domain names, Google Ads, social media advertising, business cards, print materials — all deductible.
13. Business Insurance
General liability insurance, professional liability (E&O) insurance, and business property insurance premiums are deductible.
14. State LLC Fees
Your annual report fee, registered agent fee, and any state business license fees are deductible business expenses.
15. Qualified Business Income (QBI) Deduction
Under Section 199A, eligible LLC owners can deduct up to 20% of qualified business income from their taxable income. This is a huge deduction that many LLC owners either do not know about or claim incorrectly. Income phaseouts apply for certain service businesses above $191,950 (single) or $383,900 (married filing jointly) in 2026.
Track Everything
The best deduction is worthless if you cannot prove it. Use accounting software like QuickBooks or Wave, keep digital copies of receipts, and separate your business and personal expenses completely.
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